How can businesses nudge 'stuck' consumers to be greener?

How can businesses nudge 'stuck' consumers to be greener?

What have the turbulent past few years done for consumers' behaviors around the environment? With political leadership on the issue notable only by its absence, the issue of whether consumers will ever embrace the sort of behavioral change most experts say is needed to avoid future environmental disaster is becoming ever more pressing.

Leadership companies will be those that get into the game and join those already playing. That means boosting their credibility and building much-needed trust in business to nudge "stuck" consumers on the environment.

Consumer behavior is stalled despite widespread socioenvironmental values that, in theory, should be fertile ground for growth, according to the 2012 Greendex, National Geographic's biannual index on sustainable consumption across 17 countries.

Greendex is a composite indicator comprised of 65 individual variables spanning the categories of housing, food, transportation and consumer goods. We have seen no substantive change in Greendex sustainability scores since 2008. Effective companies will be — and need to be — the ones who will change this.

Despite this behavioral stasis, 56 percent of consumers across the countries studied agree that they are very concerned about environmental problems. Only 13 percent disagree. And four in 10 say that environmental problems are having a negative impact on their health. These views are particularly pronounced in large developing economies like India, China and Brazil. Not by coincidence, these are also the homes to consumers with the lightest environmental footprint (for now).

Ironically, however, consumers in countries with the highest Greendex scores and the least intensive cultures of consumption are the most likely to feel guilty about the impact that they have on the environment as consumers (see chart below).

At the same time, they feel least empowered to make a difference as individuals given the severity of the problems they witness daily.

Yet, between a fifth and a quarter of Indians, Chinese and Brazilians say that owning a "luxury car" is a "very important goal" in their life — a surrogate measure of material aspirations. These are the highest proportions anywhere we surveyed.

In contrast, those in North America and Europe feel most empowered, feel the least guilt, and yet register the poorest Greendex scores. Clearly, perspectives and behavior are discordant.

Consumer aspiration in developing economies is high, and these countries are also high-value targets for companies who have seen their returns plateau in the west. Is there an opportunity in the environmental consciousness and related guilt that we see among the growing middle classes of the South and the East to change the terms of the debate?

In the short term, we think there is. Guilt reduction got the green market segment off the ground in 1980s in the West but we failed to reach a tipping point. In the medium term, bigger challenges need to be conquered.

Companies will need to address and effectively communicate a meaningful minimization of impacts across product lifecycles. They will need to price in the cost of natural capital. Brands will need to sell more value and less stuff.

But in order to accomplish any of this, committed companies will need to help build trust in business, which is currently in short supply. Lack of corporate credibility on environmental responsibility is what holds us back from true systemic behavior change, GlobeScan's modeling finds.

If we're to help consumers get "unstuck" on the environment, companies need to get serious about building the credibility that they know what needs to be done, and are doing it.